What is prohibited conduct?
Simply put, prohibited conduct refers to a bank imposing undue pressure on a person, or coercing a person, for any purpose, or taking advantage of a person, in its dealings with customers and the public.
Coercive tied selling is one example of prohibited conduct that involves a bank imposing undue pressure on or coercing a person to obtain a product or service from a particular person, including the bank or any of its affiliates, as a condition for obtaining another product or service from the bank.
Making these practices illegal means you get the product or service you want without being unduly pressured, coerced or taken advantage of.
Examples of prohibited conduct
You’ve been a loyal client dealing with your bank’s banking centre for several years. One of your advisors tells you that she’s behind on her monthly targets and asks you to open a new credit card even though you don’t need or want one.
You attend the banking centre for a servicing request. The advisor offers a credit card; you decline saying you don’t need one. The advisor continues to offer the credit card. Each time you provide a reason for not needing it, they counter your response. You relent and agree to the credit card.
Examples of prohibited conduct involving coercive tied selling
Your bank’s mortgage specialist tells you that you qualify for a home mortgage. However, you’re also told that the bank will approve your mortgage only if you transfer your investments to the bank or its affiliates. You want the mortgage, but you don’t want to move your investments.
You’re advised that you qualify for a Registered Retirement Savings Plan (RRSP) loan. However, you’re also told that the bank will approve the loan only if you use the money to buy the bank’s mutual funds. You want the loan, but you want to invest the money elsewhere.
All of these practices are against the law. You shouldn’t be pressured or coerced to purchase a product or service you neither want nor need. A bank employee should never take advantage of you, your relationship with the bank, or your situation to sell you a product or service you don’t need or want. If you qualify for a product, a banking representative isn’t allowed to unduly pressure you into buying an unwanted product or service as a condition of obtaining the product you want.
